North Carolina is suing Vietnamese electric-vehicle ( EV ) manufacturer VinFast over its alleged failure to fulfil commitments to build a major EV and battery manufacturing facility in the US state.

 According to a statement issued by North Carolina attorney general Jeff Jackson, the automaker has abandoned work on the 712-hectare site in Chatham County for more than a year. Under the original agreement, VinFast was licensed to construct the plant with the promise of creating 7,500 jobs and investing more than US$3 billion in the US state.

“VinFast agreed to build a factory and create jobs for North Carolinians – it didn’t do either,” Jackson says in a statement, dated May 21. “When North Carolina makes a deal, we build in protection for taxpayers. VinFast broke the deal, so we’re using that protection to find a project for this site that will create jobs.”

The issue dates back to when VinFast first announced the massive project in March 2022, initially aiming to begin production by mid-2024. Later that year, company executives signed an agreement allowing the state to buy back the property if vertical construction did not begin by January 1, 2024, or if operations failed to commence by July 1, 2026.

Because VinFast pushed the projected launch date back to 2028, citing market uncertainties, the state alleges it is now contractually impossible for the automaker to meet those binding operational deadlines.

As a result, North Carolina is now seeking to exercise its option to reclaim the land for a future manufacturer and demanding the repayment of US$80 million previously allocated to VinFast for site preparation.

The project’s failure marks a significant blow to US state, as VinFast’s plans were originally projected to grow North Carolina’s economy by at least US$71.59 billion over 32 years. The state had agreed to a job-creation grant, providing up to US$316.1 million in tax reimbursements over that period, contingent on the company meeting its strict hiring and investment benchmarks.